Daniel v. Life Ins. Co. of Virginia
Decision Date | 03 February 1937 |
Docket Number | No. 8576.,8576. |
Citation | 102 S.W.2d 256 |
Parties | DANIEL et al. v. LIFE INS. CO. OF VIRGINIA. |
Court | Texas Court of Appeals |
Appeal from District Court, Travis County; Hardy Hollers, Special Judge.
Suit by the Life Insurance Company of Virginia against R. L. Daniel and others. From a judgment for plaintiff, defendants appeal.
Affirmed.
Wm. McCraw, Atty. Gen., and T. F. Morrow, Vernon Coe, and W. W. Heath, Asst. Attys. Gen., for appellant.
Hart, Patterson & Hart and Coleman Gay, all of Austin, for appellee.
This appeal presents the sole question: Whether the considerations paid for annuity contracts are "premiums * * * on policies of insurance" within the meaning of R.C.S. art. 4769, which levies an occupation tax on foreign life insurance companies doing business in this state, measured by the gross amount of such premiums collected from citizens of this state.
The suit was by appellee, a corporation chartered under Virginia laws having a permit to do business in Texas, against the Insurance Commissioners, the State Treasurer, and the Attorney General, under chapter 214, p. 637, Gen.Laws, Reg. Sess. 43d (1933) Leg. , to recover the amount of tax based upon annuity contract considerations demanded by the Insurance Commission and paid by appellee under protest in accordance with said statute.
The pertinent portion of article 4769 reads:
The article was originally enacted in 1909 as a part of section 1, c. 3, Gen.Laws 1st Called Sess. 31st Leg., p. 264, and was brought forward in the 1911 and 1925 codifications without substantial change in wording.
Absent something in the context or other portions of the statutes showing a different legislative intent — a subject we shall discuss later — the words "premiums on insurance" must be given their generally accepted meaning. Article 10(1), R.S.C.
From a careful examination of the authorities upon the subject, it is quite manifest that in general parlance insurance does not include contracts of annuity. This has been the invariable holding wherever the subject has reached the courts for decision. The distinguishing characteristics of the two, as gleaned from the adjudicated cases, are thus stated in 3 Corpus Juris Secundum, Annuities pp. 1375, 1376:
The following cases we believe comprise all the adjudications having material authoritative bearing upon the subject:
Commonwealth v. Met. Life Ins. Co. 254 Pa. 510, 98 A. 1072, is on all fours with that at bar. There the question was whether considerations paid for annuities were "premiums * * * received in money or in the form of notes, credits, or any other substitute for money" (Act June 1, 1911, P.L. 607, § 16), under the taxing laws of Pennsylvania. The tax was levied there, as here, against "every insurance company or association of another state or foreign government, authorized to do business in this commonwealth." The basis of the holding that considerations for annuities were not included in such premiums is thus summarized in the syllabus:
Also on all fours with the instant case is the New York case of People ex rel. Metropolitan Life Ins. Co. v. Knapp, 193 App.Div. 413, 184 N.Y.S. 345, 346 (affirmed 231 N.Y. 630, 132 N.E. 916). This was also a tax case and the decision was the same as that in the Pennsylvania Case, above. We quote from the opinion:
In Hall v. Insurance Co., 146 Or. 32, 28 P.(2d) 875, the Supreme Court of Oregon held that contracts of annuity were not policies of insurance within the meaning of a statute of that state requiring insurance companies before issuing insurance policies to file forms thereof with the insurance commissioner.
The Circuit Court of Appeals of the Tenth Circuit reached the same conclusion with regard to a Colorado statute prohibiting delivery of any policy of insurance until its form had been filed with the commissioner of insurance. Rishel v. Insurance Co., 78 F.(2d) 881.
In Carroll v. Insurance Co. (D.C.W.D. Mo.) 9 F.Supp. 223, the question was whether a mutual insurance company had power under the laws of Missouri to grant a contract of annuity. It was held that such contract was not insurance, but that the company was authorized to make it under the wording of Missouri statutes.
In the Massachusetts case of Curtis v. Insurance Co., 217 Mass. 47, 104 N.E. 553 Ann.Cas.1915C, 945, the contract involved was to pay a lump sum on a specific date if the grantee was then living. This was construed to be a contract "purely of endowment," and not one of insurance. The only difference between it and the ordinary contract of annuity lay in the fact that it provided for a single payment, contingent upon the life of the grantee, whereas the ordinary annuity contract provides for payments at stated intervals during the grantee's life. The conclusion reached was based upon the same reasoning applied by other courts to annuities.
Physicians, etc. v. Cooper, 199 F. 576, 47 L.R.A.(N.S.) 290, by the Circuit Court of Appeals, Ninth Circuit (cited by appellee), is not factually in point. The opinion presents an able discussion of the essential elements of insurance. But we do not regard the decision as having authoritative bearing upon the question at bar. The question there was whether contracts undertaking the defense of civil suits against physicians for malpractice were "insurance" within the meaning of California statutes.
Appellants rely strongly upon the definition by some lexicographers of the expression "policy of insurance" as including "often, an annuity contract or certificate of an insurance company," and upon expressions in some decisions referring, somewhat loosely, to annuity contracts as insurance.
Typical of these dictionary definitions is that of the 1934 edition of Webster's International, reading: "A certificate of insurance; any writing whereby a contract of insurance is made; the document containing the...
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